With the demand for personal protective equipment, or PPE, growing daily, advance fee scams have become increasingly popular for criminals looking to take advantage of the pandemic. Advance fee scams occur when businesses or organizations pay for goods up front, but nothing is ever shipped to the buyer. By the time the buyer becomes suspicious, the funds have already been transferred and are unrecoverable.
Unfortunately, the need in some states due to new legal requirements, has driven businesses to obtain PPE by any means necessary. In some instances, this means working with dealers they have not worked with in the past or dealers who do not have experience selling the goods they are looking to obtain.
Warning signs that community banks should pay attention to while attempting to procure PPE include:
- A seller or broker initiating the contact with the buyer, especially from a difficult to verify channel.
- The seller or broker is not an entity with which the buyer has an existing relationship.
- The seller or broker cannot clearly explain the origin of the items or how they are available, given current demand.
- The potential buyer cannot verify with the product manufacturer that the seller is a legitimate distributor or vendor of the product.
- Unexplained urgency to transfer funds or a last-minute change in previously established wiring instructions.
Coronavirus may have thrown your community bank’s supply chain for a loop, but that does not mean your bank should rush into new agreements. Carefully consider and vet new suppliers, especially if they seem too good to be true.
Additional resources for community banks: